Now that the trade wars are behind us, assets which were serving as safe havens have been turned on their head. Silver and gold are both down again this morning, with gold losing about $250 per ounce over the course of just the past week.
More importantly, Treasury Bonds continue to be in a free-fall, which in turn means that interest rates are just cranking higher.
The thing is, Jerome Powell is VASTLY more interested in the bond markets than he is, saying, what Carvana and Grindr price quotes are. With the President screeching about “Too Late” Powell, and demanding lower interest rates so that the economy can have “rocket boosters” put on it, the fact is that rate cuts aren’t going to happen. It flies directly in the face of what the market is doing, political desires be damned.
I return, as always, to our multi-decade ratio chart of worldwide equity markets divided by gold. The story is as plain as day: long-term, be bearish equities and bullish gold. This recent skyrocketing of stocks and punching-down of gold will be reversed in due time, and big-time.
In the meantime, the last bastion of Fibonacci compliance is our friend the small cap futures, /RTY, which hit a pitch-perfect level of support on April 7th and appears to be gasping its last just below the level two levels higher.
With the risible trade war nonsense behind us, as well as the CPI, I am more comfortable getting aggressive. I am presently at 15 positions and 80% commitment, but I shall now turn my attention to cranking both of those numbers higher. Good luck out there!
